By Scott Kanowsky
Investing.com — The German government is eyeing a potential increase of its stake in ailing energy firm Uniper SE (ETR:), as the company struggles to remain solvent following a cut to key Russian gas supplies.
In a statement on Wednesday, Uniper said its main shareholders, which include Berlin, and Finnish peer Fortum (HE:), are mulling a straight equity rise that would give Germany “significant majority participation” in the firm.
Shares in Uniper, which has already taken nearly €20 billion in government support, fell sharply following the announcement.
Uniper added that its financial losses since July have jumped considerably due to the higher energy procurement costs in the wake of Russia closing off gas supplies through the key Nord Stream 1 pipeline. As a result, Uniper – which was the biggest importer of Russian gas before the outbreak of the war in Ukraine – is reportedly nearing insolvency.
“The deteriorating operating environment and Uniper’s financial situation have to be taken into account while Fortum, the German government, and Uniper continue their discussions on a long-term solution for Uniper,” the company said.
It added that no decisions have been made beyond what was agreed in a previous stabilization package unveiled in July.
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